Money Politics on Trial

High court should uphold new campaign-finance law

September 10, 2003

Ever since the Bipartisan Campaign Reform Act (BCRA) became law last November, both major political parties have retooled the way they raise and spend campaign money - even as legal challenges have taken the new law all the way to the Supreme Court. The nine justices have sped up a review of the law in order to rule before the 2004 elections, and they held an unusual four hours of oral argument on Monday.

For all the complexity surrounding ways to curb money politics, such retooling is exactly what the BCRA was designed to foster.

As an array of high-powered attorneys either defended or decried the BCRA before the court, the political parties have been busy raising more "hard" dollars - federally limited donations from individuals - as allowed by the new law. From Jan. 1 of this year through the end of June, the national party committees raised $161 million - 45 percent more hard money than during the same period in 2002; 50 percent more than in 2000.

Among other provisions, the BCRA rightly bans soft money - unrestricted donations flowing from businesses, unions, and individuals into national political-party coffers. Before the BCRA, large loopholes in existing laws allowed for a dramatic storm surge of money into politics.

That trend has been rocket-swift in the wrong direction: Soft-money contributions went from $19 million in 1980 to $86 million in 1992. In 2002, the total was $496 million.

Evidence of corruption

Lawyers for the coalition opposed to the BCRA argued Monday that contributions don't create corruption or the appearance of it. But there's plenty of evidence to the contrary. Look no further than the fact that a large majority of the largest donors to campaigns gave to both parties in the last election in an obvious effort to win government favors no matter who's holding the reins of power. One energy-industry CEO pledged $175,000 to the GOP in 1996; the party chairman then escorted him, according to a friend-of-the-court brief, to "four appointments that turned out to be very significant in the legislation affecting public utility holding companies."

The BCRA also puts sensible limits on campaign advertising in restricting so-called "sham" issue ads. Simply, it allows corporations, labor unions, and certain advocacy groups to spend money only from a political action committee (PAC) to pay for broadcast ads that mention federal candidates in the waning days of an election. (Contributions to such PACs are limited and must come from individuals on a voluntary basis.)

A key argument in the plaintiffs' case holds that the BCRA weakens the First Amendment with such advertising restrictions - an "undue burden," as one plaintiff attorney put it. Surely, the "burden" of a special-interest group having to set up a PAC to support candidates is a fair trade-off.

The justices' line of questioning also seemed to suggest a lot of interest in how the new law may impinge on various state laws governing campaign donations and expenditures.

Such federalist notions are appealing, but the political parties at the federal and state level are too fully integrated to simply uphold the BCRA at the federal level, and not uphold at least some of its provisions at the state level. In fact, without such consistency, new loopholes will more readily be found. Already, there's some evidence of the parties back-channeling money through state-party coffers.

Divided court

At the end of the arguments, it was far from clear how the court might rule. The court appeared divided, at the least, with experts saying Chief Justice William Rehnquist and Justice Sandra Day O'Connor would be the "swing" votes. Justice O'Connor has ruled favorably for regulating campaign finance in past decisions.

The BCRA never purported to be the final fix to the undue influence of special-interest money in American politics. Congress has been trying since 1907 to get it right.

Yet the court should uphold BCRA's soft-money ban. And it should uphold the BCRA's requirements relating to issue ads. Without that, politics-as-usual will, most unfortunately, be usual again. And the very basis of the Constitution - a legislature acting on behalf of a majority of the people and not special interests - will be further eroded.